Hyundai sees salvation in ’18 Sonata

on Jul29

Hyundai is counting on Sonata demand while it expands its crossover lineup.

LA JOLLA, Calif. — In 2010 Hyundai put the midsize sedan segment — and the industry — on notice by introducing a progressively styled Sonata that won accolades the world over. Four years later, its conservative successor landed with a thud.

The timing of that reboot certainly didn’t help. Crossovers were beginning to erode sedan sales, and haven’t stopped since. Meanwhile Hyundai’s rivals amped up the styling and execution of their midsize sedans. Sonata sales dropped each year after the latest generation debuted as a 2015 model; they’re down a whopping 27 percent for the first half of 2017.

“We went from a very striking design, to a very beautiful car, but it just didn’t turn heads like the car before it did,” Mike O’Brien, Hyundai’s vice president of product planning, said at the Sonata press launch here this month.

For Hyundai, salvation comes in the form of a midlife freshening for the 2018 Sonata.

New sheet metal, a revised trim and pricing strategy and a focus on refinement round out the car’s notable upgrades.

While they’re certainly significant, those changes can likely do only so much to change the Sonata’s fortunes. Sales of midsize sedans dropped 12 percent in 2016, and they’re down another 18 percent through June of this year.

And customers who are sticking with sedans are about to get a bumper crop of fresh choices. Toyota’s redesigned 2018 Camry is on sale now, Honda’s redesigned 2018 Accord hits the market this year and Nissan’s redesigned Altima arrives next year. That trio has long dominated the top of the midsize sales charts, gobbling up more than half of segment sales this year through June.

Despite these considerable headwinds, Hyundai is optimistic about its chances with the Sonata.

For one thing, the automaker points to sales forecasts and other market data that it says prove the flight of consumers from sedans and toward crossovers has leveled off.

“Based on all the industry indices, it appears we’ve about reached equilibrium between car and truck,” O’Brien said.

The data — gleaned from J.D. Power’s Power Information Network — include incentive spending as a percentage of sticker price, days supply and days to turn. O’Brien also cited IHS Markit data that forecasts the decline of midsize sedan sales will bottom out in 2019 at 1.75 million units, or about 10 percent of the U.S. market.

“The industry’s basically balancing out,” O’Brien told Automotive News. “The numbers you’re seeing now are more reflective of natural demand.”

Hyundai has many reasons to hope these forecasts pan out. The automaker’s production still skews heavily toward cars — 68 percent for the first six months of 2017, compared with an industry mix of 37 percent, O’Brien said. Hyundai is in the early stages of a multiyear effort to expand and resize its crossover lineup to better match consumer tastes. In the meantime, it will depend on strong Sonata demand.

Hyundai worked to make the Sonata more compelling with new sheet metal on the front and rear ends, leaving behind the dull look of the 2015-17 model and aiming to recapture the mojo of the 2011-14 version.

Hyundai also revised the trim strategy of the 2018 Sonata to pay more attention to the middle of the segment’s price range, a spot that holds the most potential for volume but one where Hyundai now admits the earlier Sonata wasn’t competitive.

A new midlevel SEL trim has been added, starting at $24,585 including shipping. Hyundai also lopped $1,850 off the price of the top-end Limited 2.0T to create a more moderate price walk up the trim levels. It now starts at $33,335, including shipping.

O’Brien said: “We shook up our trim strategy and came up with something that we think is going to create a much better sales proposition for us.”

Previous postCorey Seager's two home runs lead Dodgers to come-from-behind win over the Giants Next postNo green thumb needed: 6 drought-tolerant herbs that are almost impossible to kill

Leave a Reply

Your email address will not be published. Required fields are marked *

Los Angeles Financial times

Copyright © 2020 Los Angeles Financial times

Updates via RSS
or Email